Market Compass
October 2018

Edited by the Macro & Market Research Team. The team of 13 analysts based in Paris, Cologne, Trieste, Milan and Prague runs qualitative and quantitative analysis on macroeconomic and financial issues.

The team translates macro and quant views into investment ideas that feed into the investment process.

  • Global growth while solid, has passed its peak and became more uneven among countries. Weaknesses in some emerging economies (Turkey and Argentina) contrast with above potential US growth.  
  • Politics (Italy, Brexit, US trade and foreign policy) will remain a strong risk factor. Yet growth in the US and China should moderate but stay solid. In the Euro Area strong domestic activity provides a cushion to risks to export.
  • We expect the Fed as well as the ECB to proceed on their policy normalization path amid signs of higher underlying inflation.
  • Despite these risks, sentiment and positioning lead us to re-weight slightly towards equities and credit, starting from the  cautious allocation we suggested this summer. 
MARKET COMPASS OCTOBER 2018

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